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  By: Fraser  S.B. No. 632
         (In the Senate - Filed February 18, 2015; February 23, 2015,
  read first time and referred to Committee on Natural Resources and
  Economic Development; April 21, 2015, reported adversely, with
  favorable Committee Substitute by the following vote:  Yeas 10,
  Nays 0; April 21, 2015, sent to printer.)
Click here to see the committee vote
 
  COMMITTEE SUBSTITUTE FOR S.B. No. 632 By:  Fraser
 
 
A BILL TO BE ENTITLED
 
AN ACT
 
  relating to the creation of the governor's university research
  initiative and to the abolishment of the Texas emerging technology
  fund.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Chapter 62, Education Code, is amended by adding
  Subchapter H to read as follows:
  SUBCHAPTER H.  GOVERNOR'S UNIVERSITY RESEARCH INITIATIVE
         Sec. 62.161.  DEFINITIONS. In this subchapter:
               (1)  "Distinguished researcher" means a researcher who
  is:
                     (A)  a Nobel laureate; or
                     (B)  a member of the National Academy of Sciences,
  the National Academy of Engineering, the Institute of Medicine, or
  the National Research Council.
               (2)  "Eligible institution" means a general academic
  teaching institution or medical and dental unit.
               (3)  "Fund" means the governor's university research
  initiative fund established under this subchapter.
               (4)  "General academic teaching institution" has the
  meaning assigned by Section 61.003.
               (5)  "Medical and dental unit" has the meaning assigned
  by Section 61.003.
               (6)  "Office" means the Texas Economic Development and
  Tourism Office within the office of the governor.
               (7)  "Private or independent institution of higher
  education" has the meaning assigned by Section 61.003.
         Sec. 62.162.  ADMINISTRATION OF INITIATIVE. (a)  The
  governor's university research initiative is administered by the
  Texas Economic Development and Tourism Office within the office of
  the governor.
         (b)  The office may adopt any rules the office considers
  necessary to administer this subchapter.
         Sec. 62.163.  MATCHING GRANTS TO RECRUIT DISTINGUISHED
  RESEARCHERS. (a)  From the governor's university research
  initiative fund, the office shall award matching grants to assist
  eligible institutions in recruiting distinguished researchers.
         (b)  An eligible institution may apply to the office for a
  matching grant from the fund. If the office approves a grant
  application, the office shall award to the applicant institution a
  grant amount equal to the amount committed by the institution for
  the recruitment of a distinguished researcher.
         (c)  A matching grant may not be used by an eligible
  institution to recruit a distinguished researcher from:
               (1)  another eligible institution; or
               (2)  a private or independent institution of higher
  education.
         Sec. 62.164.  GRANT AWARD PRIORITIES. In awarding grants,
  the office shall give priority to grant proposals that involve the
  recruitment of distinguished researchers in the fields of science,
  technology, engineering, and mathematics.  With respect to
  proposals involving those fields, the office shall give priority to
  proposals that demonstrate a reasonable likelihood of contributing
  substantially to this state's national and global economic
  competitiveness.
         Sec. 62.165.  GOVERNOR'S UNIVERSITY RESEARCH INITIATIVE
  FUND. (a)  The governor's university research initiative fund is a
  dedicated account in the general revenue fund.
         (b)  The fund consists of:
               (1)  amounts appropriated or otherwise allocated or
  transferred by law to the fund;
               (2)  money deposited to the fund under Section 62.166;
  and
               (3)  gifts, grants, and other donations received for
  the fund.
         Sec. 62.166.  WINDING UP OF CONTRACTS AND AWARDS IN
  CONNECTION WITH FORMER TEXAS EMERGING TECHNOLOGY FUND. (a)  The
  governor's university research initiative is the successor to the
  former Texas emerging technology fund. Awards from the former
  Texas emerging technology fund, and contracts governing awards from
  that fund, shall be wound up in accordance with this section.
         (b)  If a contract governing an award from the former Texas
  emerging technology fund provides for the distribution of
  royalties, revenue, or other financial benefits to the state,
  including royalties, revenue, or other financial benefits realized
  from the commercialization of intellectual or real property
  developed from an award from the fund, those royalties, revenues,
  or other financial benefits shall continue to be distributed in
  accordance with the terms of the contract unless the award
  recipient and the governor agree otherwise.  Unless otherwise
  required by law, royalties, revenue, or other financial benefits
  accruing to the state under a contract described by this subsection
  shall be credited to the governor's university research initiative
  fund.
         (c)  If money awarded from the former Texas emerging
  technology fund is encumbered by a contract executed before
  September 1, 2015, but has not been distributed before that date,
  the money shall be distributed from the governor's university
  research initiative fund in accordance with the terms of the
  contract, unless the award recipient and the governor agree
  otherwise.
         (d)  If money awarded from the former Texas emerging
  technology fund under a contract executed before September 1, 2015,
  has been fully distributed, the entity that received the award is
  considered to have fully satisfied the entity's obligations and
  fully performed all specific actions under the terms of the
  contract governing the award.  The entity shall file with the office
  a final report showing the purposes for which the award money has
  been spent and, if award money remains unspent, the purposes for
  which the recipient will spend the remaining money.  The entity is
  not required to return to the state any award money received under
  the contract.
         (e)  The Texas Treasury Safekeeping Trust Company shall
  manage the following:
               (1)  equity positions in the form of stock or other
  security taken by the governor, on behalf of the state, in companies
  receiving awards under former Chapter 490, Government Code, before
  September 1, 2015; and
               (2)  any other investments, excluding grants, made by
  the governor on the state's behalf in connection with an award made
  under former Chapter 490, Government Code, before September 1,
  2015.
         (f)  As soon as practicable after September 1, 2015, the
  Texas Treasury Safekeeping Trust Company shall begin winding up the
  state's portfolio of equity positions and other investments
  described by Subsection (e) by selling the stock and other
  investments when it is economically advantageous to the state to do
  so.  The trust company has any power necessary in performing duties
  under this subsection and Subsections (e) and (g) to accomplish the
  purpose of this section. In managing those investments through
  procedures and subject to restrictions that the trust company
  considers appropriate, the trust company may acquire, exchange,
  sell, supervise, manage, or retain any kind of investment that a
  prudent investor, exercising reasonable care, skill, and caution,
  would acquire or retain in light of the purposes, terms,
  distribution requirements, and other circumstances then prevailing
  pertinent to each investment. 
         (g)  Proceeds or other earnings from the sale of stock or
  other investments in the state's portfolio of equity positions and
  other investments described by Subsection (e) shall be deposited to
  the credit of the governor's university research initiative fund,
  taking into consideration the expenses of managing and liquidating
  the equity positions and other investments.
         Sec. 62.167.  CONFIDENTIALITY OF INFORMATION CONCERNING
  AWARDS FROM FORMER TEXAS EMERGING TECHNOLOGY FUND. (a)  Except as
  provided by Subsection (b), information collected under former
  Chapter 490, Government Code, concerning the identity, background,
  finance, marketing plans, trade secrets, or other commercially or
  academically sensitive information of an individual or entity that
  was considered for or received an award from the former Texas
  emerging technology fund is confidential unless the individual or
  entity consents to disclosure of the information.
         (b)  The following information collected in connection with
  the former Texas emerging technology fund is public information and
  may be disclosed under Chapter 552, Government Code:
               (1)  the name and address of an individual or entity
  that received an award from the former Texas emerging technology
  fund;
               (2)  the amount of funding received by an award
  recipient;
               (3)  a brief description of the project funded under
  former Chapter 490, Government Code;
               (4)  if applicable, a brief description of the equity
  position that the governor, on behalf of the state, has taken in an
  entity that received an award from the former Texas emerging
  technology fund; and
               (5)  any other information with the consent of:
                     (A)  the governor;
                     (B)  the lieutenant governor;
                     (C)  the speaker of the house of representatives;
  and
                     (D)  the individual or entity that received an
  award from the former Texas emerging technology fund, if the
  information relates to that individual or entity.
         Sec. 62.168.  REPORTING REQUIREMENTS. (a)  Before the
  beginning of each regular session of the legislature the governor
  shall submit to the lieutenant governor, the speaker of the house of
  representatives, and the standing committees of each house of the
  legislature with primary jurisdiction over economic development
  and higher education matters and post on the office of the
  governor's Internet website a report on grants made from the
  governor's university research initiative fund that states:
               (1)  the total amount of matching funds granted by the
  office;
               (2)  the total amount of matching funds granted to each
  institution;
               (3)  a brief description of each distinguished
  researcher recruited by each institution, including any amount of
  external research funding that followed the distinguished
  researcher to the recruiting institution;
               (4)  a brief description of the expenditures made from
  the matching grant funds for each distinguished researcher; and
               (5)  when available, a brief description of each
  distinguished researcher's contribution to the state's economic
  competitiveness, including but not limited to:
                     (A)  any patents issued to the distinguished
  researcher after accepting employment by the recruiting
  institution; and
                     (B)  any external research funding, public or
  private, earned by the distinguished researcher after accepting
  employment by the recruiting institution.
         (a-1)  The report may not include information that is made
  confidential by law.
         (b)  The governor may require a recipient of a grant under
  the governor's university research initiative to submit, on a form
  the governor provides, information required to complete the report.
         SECTION 2.  (a)  Chapter 490, Government Code, is repealed.
         (b)  The repeal by this Act of Chapter 490, Government Code,
  does not affect the validity of an agreement between the governor
  and the recipient of an award awarded under Chapter 490, or a person
  to be awarded money under that chapter, that is executed before
  September 1, 2015. Those agreements shall be performed as provided
  by Section 62.166, Education Code, as added by this Act.
         (c)  A regional center of innovation and commercialization
  established under Section 490.152, Government Code, is abolished on
  the effective date of this Act.  Each center shall transfer to the
  office of the governor a copy of any meeting minutes required to be
  retained under Section 490.1521, Government Code, as that section
  existed immediately before that section's repeal by this Act, and
  the office shall retain the minutes for the period prescribed by
  that section.
         (d)  The Texas emerging technology fund is abolished.  On the
  effective date of this Act, the comptroller of public accounts
  shall transfer any unexpended balance of that fund as follows:
               (1)  50 percent of the balance to the credit of the
  Texas Enterprise Fund under Section 481.078, Government Code; and
               (2)  50 percent of the balance to the credit of the
  governor's university research initiative fund established under
  Subchapter H, Chapter 62, Education Code, as added by this Act.
         (e)  On September 1, 2015, the following powers, duties,
  functions, and activities performed by the office of the governor
  immediately before that date are transferred to the Texas Treasury
  Safekeeping Trust Company:
               (1)  all powers, duties, functions, and activities
  related to equity positions in the form of stock or other security
  the governor has taken, on behalf of the state, in companies that
  received awards under Chapter 490, Government Code, before
  September 1, 2015; and
               (2)  all powers, duties, functions, and activities
  related to other investments, excluding grants, made by the
  governor, on behalf of the state, in connection with an award made
  under Chapter 490, Government Code, before September 1, 2015.
         (f)  Notwithstanding the repeal by this Act of Chapter 490,
  Government Code, that chapter is continued in effect for the
  limited purpose of winding down contracts governing awards from the
  Texas emerging technology fund and the state's portfolio of equity
  positions and other investments in connection with awards from that
  fund in accordance with Section 62.166, Education Code, as added by
  this Act.
         SECTION 3.  This Act takes effect September 1, 2015.
 
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